by David Agren, Special for USA TODAY

by David Agren, Special for USA TODAY

MEXICO CITY - Violeta León, 34, has worked in various accounts receivables departments for years on a "semi-formal" basis, keeping regular office hours but getting no health, housing or social security type of benefits.

The use of such freelance workers, or contract employees, is common in Mexico, where labor laws make it next to impossible to lay off workers in a downturn or fire poor performers.

"It's really hard to get yourself established," says León, who was fortunate enough recently to find a formal job with full benefits.

An overhaul of the country's labor laws passed last week by the Mexican Congress may be the first step toward strengthening the formal economy. Mexico's outgoing president, Felipe Calderón, says the measure will promote job creation and improve working conditions in a country where about 30% of the population works in the informal economy.

The changes - the first major changes to Mexican labor laws in more than 40 years - ease legal constraints on a company's ability to hire and fire, lift a ban on part-time employment, allow probationary periods for new hires and cap the amount of money a company must pay to laid-off workers.

They also limit a company's ability to hire freelance workers as a way to get around the strict labor laws.

"Implementing labor reforms gives incentives to invest and promotes the incorporation of informal jobs into the formal sector, providing social security to workers and their families," business group Coparmex said in a statement.

Left-wing lawmakers opposed the changes, arguing they would weaken worker rights and protect powerful union bosses who often lead lavish lifestyles. No changes were made to rules that prevent outside audits of union financial records or union members from viewing the contents of union contracts.

"It's the worst of both worlds," says Cristina Auerbach, a labor lawyer working with coal miners in the northern state of Coahuila, of the recent reforms. "It strips away rights from workers and leaves union leaders untouched."

Mexico's unions are key backers of the Institutional Revolutionary Party (PRI), which takes power Dec. 1 after being out of office for 12 years. The party has active union leaders in its congressional delegations.

Left-wing lawmakers in the Senate unsuccessfully attempted to add an article to the law so that labor leaders would have to consult workers before calling a strike. The article was an attempt to end "ghost unions," which organize work sites without the consent of the workers then demand the business owners sign contracts to avoid being shut down by strikes.

Luisa Alcalde, lawmaker from the Citizens' Movement party, says the unions are extorting from all sides under such schemes.

PRI lawmakers voted down changes that would have added full transparency to the union ledgers and required union leaders be voted in by secret ballot. PRI lower house leader Manlio Fabio Beltrones said the party is in favor of transparency but that unions should decide how to elect its leaders.

The provisions that did pass will allow unions to opt for secret-ballot elections under certain conditions and oblige them to make their accounts open to workers every six months.

Construction worker Ricardo Munguia, 30, has benefited from Mexico's labor laws in some ways, such as the Christmas bonuses all employees receive. But he knows little about the unions that have represented him on job sites over the years and even less about the way labor leaders have spent his dues.

"A lot of (money) gets diverted," he says.

The PRI resistance to the changes appeared to contradict the pledge of PRI President-elect Enrique Peña Nieto to promote transparency, improve access to information and create and anti-corruption commission. Analysts say the pledge will be difficult to keep.

"If you make unions more democratic, the PRI would lose one of its bases," says political analyst Fernando Dworak.

Manuel Molano, adjunct-director of the Mexican Competitiveness Institute, says the overhauling of labor laws is long overdue and benefits employers and employees alike.

Currently, cases of employees disputing terminations can take years to resolve in tribunals, and employers must pay back wages accrued during the proceedings if they lose. The "semiformal" employment offered to get around strict labor laws has left many without benefits, and the prohibition on part-time employment has hurt young workers.

"Many young people and women cannot find work because of a ban on part-time employment," says César Velázquez Guadarrama, professor of public policy at the Iberoamerican University.